Saturday, July 11, 2009

A Must See!

Interview with Democrat Dennis Kucinich on the Federal Reserve:


Q: So, who has ultimate oversight power over the Fed?

A: Well, we have oversight power of the Fed, but the fact of the matter is that the Federal Reserve is as "federal" as Federal Express. What we should do is put the Federal Reserve under the U.S. Treasury so that we have control over their activities. Instead, what the government has done is give the Federal Reserve the ability to basically print money, to create money out of nothing, and to distribute it through their chain of contacts on Wall Street.

Q: Congressman Paul has introduced H.R. 1207 that would have a comprehensive audit of the Federal Reserve by the GAO by 2010.

A: And I support that. Absolutely. Congressman Paul has been very vigilant on matter relating to the Federal Reserve. He and I agree with each other on this. We work together on matters of government accountability. The Federal Reserve should be accountable. However, they’re not directly a government organization, but they’re a creature of the government. And it was the privatization of our banking system that has given great power to vested interest in this country and they can use it for better or worse. Lately, it’s been for worse.

Q: So you feel the Fed is partly responsible for our current economic crisis?

A: Of course they are.

Q: How so?

A: The oversight responsibilities that the Fed has over the banking system are really not exercised in the interests of the American people. They were supposed to provide oversight on the conduct of banks and they didn’t do that. They basically looked the other way as banks started to dump massive amounts of money into mortgage-backed securities and these collateralized debt obligations kept growing and growing and growing. The Fed should have known. It’s their business to know the danger the economy was headed towards when people began to default in paying their mortgagees. They should have known.

Q: So, it sounds like that you’re saying the Federal Reserve is not succeeding in its mission.

A: Well... one needs to understand the mission of the Federal Reserve. And its mission, at its core, is to be supportive of the private banking system. One could argue that they have not done that by looking the other way as the banking system got heavily involved in subprime mortgages and collateralized debt obligations that actually led to the great trouble that, not just our banking system, but our entire financial system is in right now. The Federal Reserve has an obligation and they haven’t kept their obligation for oversight. So my subcommittee on Domestic Policy has jurisdiction over the Federal Reserve. And now we will exert the oversight that the Federal Reserve that the Fed was supposed to.

Q: And do you think you’ll be successful? From what I understand, the Federal Reserve has never fully been audited.

A: Well they WILL be. They cannot escape responsibility. The reach and requirements of transparency are now greater than they’ve ever been. And so, The Fed is not going to be able to escape those requirements. It’s a whole new world and the Federal Reserve will have to adjust to that. Again, I personally favor taking the Federal Reserve and putting it under the Treasury Department, so that way we actually have control over our monetary policies.

Q: Where is it now?

A: The Federal Reserve operates as a separate agency. We don’t really have control over the Federal Reserve. The Federal Reserve is an independent banking authority.

Q: And then who owns the Federal Reserve?

A: The Federal Reserve is owned by its member banks.

Q: And who are they?

A: Banks from all across America. So we need to get control back of our money supply. And that’s what I’m working on.

Q: How successful do you think H.R. 1207 will be to audit the Federal Reserve?

A: I think that will happen.


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